The billionaire is reportedly looking at a Grand Avenue site for his art museum. Here’s what city officials should have in mind for possible negotiations.

Start with a nondescript parking lot in a strategically important location. Propose replacing it with a new building by an acclaimed architect. Repeat as often as politically or financially feasible.

That was the plan for the first phase of the ambitious but now stalled Grand Avenue project, which called for a mixed-use complex by Frank Gehry to replace a parking structure across the avenue from Gehry's Walt Disney Concert Hall.

And in the last few days have come a flurry of news reports that Eli Broad wants to build an 82,000-square-foot museum for his Broad Art Foundation on another site now filled with cars, this one a surface parking lot at the southwest corner of Grand Avenue and 2nd Street. Owned by the city, the property was originally pegged as part of the Grand Avenue development's second phase.

Broad has so far declined to confirm the reports, saying only that he is considering a pair of sites for the museum, with a Santa Monica location also in the running. Beverly Hills was pushing a third location but announced it was pulling out of the Broad sweepstakes earlier this month.

For the sake of argument, though, let's assume the property on Grand Avenue is Broad's preferred spot, given his longstanding interest in Bunker Hill and his close relationship with Jeffrey Deitch, the new director of the nearby Museum of Contemporary Art.

What would the arrival of the museum mean for Bunker Hill and downtown?

Broad, naturally, can be expected to push hard for a site and a deal that best suits his foundation, his collection and his much-debated vision for Grand Avenue. Indeed, it seems likely that Broad has kept the other sites in contention largely as a way to boost his leverage on Bunker Hill.

As is so often the case in Los Angeles, the question is who on the public side will be pushing back — and how effectively.

Handing the site over to Broad will make sense for the city only if the museum project can avoid becoming an isolated, self-contained architectural attraction in the inglorious tradition of downtown development. Indeed, even as Grand Avenue has continued to collect individual buildings by leading architects, long-imagined improvements to its streetscape have largely failed to materialize.

Talks over the Bunker Hill site will be complicated by the fact that Broad has served as co-chair of the board of the Grand Avenue Committee, which includes representatives from the city, county and Community Redevelopment Agency and has been overseeing the planned project with developer Related Cos. and Gehry.

On top of that, public officials enter those negotiations facing some clear strategic disadvantages. The first is the sense, masterfully cultivated by Broad, that downtown power brokers — or those in Santa Monica or Beverly Hills, for that matter — should be courting him rather than the other way around.

The team negotiating with Broad is also shorthanded in a few key areas. The CRA remains without a permanent leader after Cecilia Estolano left last year following disputes with City Hall.

The Los Angeles Department of City Planning, meanwhile, has been ravaged by staff cutbacks in recent weeks, particularly among planners who had focused on downtown. Both Jane Blumenfeld, the city's deputy director of planning, and Emily Gabel-Luddy, who founded the planning department's Urban Design Studio and helped craft new design guidelines for downtown streets and sidewalks, have taken early retirement, eased out the door by severe budget pressures.

Nonetheless, even as Broad is reportedly poised to make a significant gift to the city — promising to pay for the design and construction of the museum while an endowment takes care of annual operating expenses — he is also asking for something significant in return: a prominent piece of property that the museum would be allowed to lease for $1 per year for 99 years.

My colleague Tim Rutten reports that Broad also wants the CRA to help raise $30 million for an underground parking garage serving the museum.

Those facts alone should give city officials some negotiating ammunition. How should they use it? What should they be angling for in discussions with Broad?

They could sensibly begin by asking how the museum's construction might be leveraged to help produce truly meaningful improvements to the blocks surrounding it — and to help draw foot traffic and avoid the hidden-in-plain-sight quality of Arata Isozaki's design for the MOCA building.

They could push Broad for an agreement, for example, to install sculptures and other artworks — from his foundation's collection, from MOCA or elsewhere — leading from the new museum to the nearby Metro subway station, or stretching through the new civic park soon to be built from the Music Center to City Hall.